Payment for child care when required to work on a weekend or holiday period

Some entities may require staff to work during a period when the employee would not normally work, for example, on weekends or between Christmas and New Year. If the employer agrees to pay for child care for employees' children during such period, the payment constitutes an expense payment fringe benefit. The benefit is not otherwise deductible because it is private in nature. If it is paid as an allowance rather than a reimbursement, it will be subject to income tax in the hands of the employee under the PAYG provisions.

    Last modified: 17 Jul 2012QC 21998